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Hello everyone, today XM Foreign Exchange will bring you "[XM Foreign Exchange Decision Analysis]: The value of US gold reserves has exceeded US$1 trillion! OPEC+'s plan to increase production is suppressed." Hope it will be www.xm-bx.comful to you! The original content is as follows:
On Tuesday, during the Asian session, spot gold was trading around $3,840/ounce. The gold price broke through $3,800 per ounce for the first time on Monday, setting a record high of $3,834.03/ounce as investors bet on the U.S. to cut interest rates, concerns about the possible government shutdown and the intensification of geopolitical tensions.
The dollar fell against major currencies such as the euro and the yen on Monday after strengthening last week as U.S. economic data was stronger than expected, and the market was waiting for key non-farm employment reports released this week to find more clues to the Fed's policy path.
The recent data released by housing, durable wealth orders and second-quarter GDP correction values are all higher than expected. In addition, the number of initial unemployment benefits in the United States has dropped significantly. These economic data prompted the market to lower expectations for the Fed's interest rate cut.
The dollar's decline is also affected by the risk of the government shutdown, and government funding will expire at midnight on Tuesday. U.S. President Trump will meet with congressional leaders at the White House on Monday to make a final effort to end the deadlock.
Marc Chandler, chief market strategist at BannockburnForex in New York, said, "Today is overall consolidation, with a slightly heavy tone. But the key is whether the government will shut down at midnight tomorrow. The next driving factor will be the employment data released on Friday, but if the government shuts down, we will not get the employment data. This means an increase in uncertainty."
The U.S. Department of Labor confirmed on Monday that once some government shutdown occurs, its statistical agencies will suspend the release of economic data, including the highly-watched September non-farm employment report.
Traders currently expect the Fed to cut interest rates by 42 basis points for the rest of the year, and a cumulative rate cut of 105 basis points by the end of 2026, about 25 basis points less than expected in mid-September.
Investors are most concerned about the U.S. government will face a shutdown if Congress fails to pass the appropriations bill before the end of Tuesday's fiscal year. If it fails, some government departments will be closed on the first day of fiscal year 2026 on Wednesday.
Analysts say the dollar usually weakens before such events and rebounds after the grant dispute is settled. The market may see it as another drag on the already weak labor market.
Karl Schamotta, chief market strategist at Corpay in Toronto, said, "History shows that the short-term government shutdown has a relatively moderate impact on the economy and foreign exchange markets."
Before Friday's job report is released, investors will also focus on data such as job openings, private employment and ISM manufacturing PMI.
The latest data released by RatingDog on Tuesday showed that China's RatingDog manufacturing purchasing managers' index (PMI) rose to 51.2 in September from 50.5 in August. The market forecast is 50.3. China's service industry purchasing managers' index fell slightly to 52.9 in September from 53 in August. This data is slightly lower than the market expectations of 52.3 during the reporting period.
China's official manufacturing purchasing managers index (PMI) rose to 49.8 in September after 49.4 in August. The reading was higher than the market's general expectations for the month of reporting 49.6.
The National Bureau of Statistics’ non-manufacturing Purchasing Managers’ index fell to 50 in September, www.xm-bx.compared with 50.3 in August, down from the expected 50.3.
Bank of England Deputy Governor Dave Ramsden said today that the UK labor market continues to be loose, wage growth is normalized, www.xm-bx.coming the deflation process. He pointed out that although inflationary pressure is high, the central bank predicts that CPI temporarily rises to 4% in September may peak.
Rumsden said he was confident that under the current restrictive policy setting, inflation would return to the 2% target, thanks to market expectations that have been included in the central bank's forecast.
He added that the Monetary Policy www.xm-bx.committee’s “gradual and prudent” strategy remains the right approach. Looking ahead, Ramsden said, "there is still room for further lifting of policy restrictions."
The White House announced earlier Tuesday that U.S. President Donald Trump signed a notice to adjust timber, timber and derivatives imported to the United States.
St. Louis Fed Chairman Alberto Mousalem said monetary policy is now "between moderately restrictive and neutral."
Musalem, who voted on the policy this year, said he was "open to" to further rate cuts, but stressed the need to act cautiously. Due to policyThere was limited room before turning to "over-easing", and he hinted that the Fed should act cautiously.
New York Fed Chairman John Williams said overnight that it makes sense that the central bank "slightly" relaxes policies to reduce restrictions to www.xm-bx.com the labor market while maintaining downward pressure on inflation.
Williams acknowledged progress in achieving the 2% inflation target, but warned that more work is needed. He stressed the Fed's dual mission, emphasizing that "improper harm" to employment needs to be avoided as job creation gradually weakens. “I don’t want to see this go too far,” he said.
Enlighteningly, Williams noted that some inflation concerns have eased, ""The tariff impact is smaller than most people think, and there seems to be no sign of increased inflation pressure," he noted.
Cleveland Fed Chairman Beth Hamack said today that she remains concerned about inflation, saying inflation remains too high in the overall, core, and especially in the service industry. In an interview with www.xm-bx.comBC, she cautioned that the Fed has not reached the 2% mission in more than four years, and that this persistence continues to seriously affect her prospects. /p>
In contrast, Hamak describes the labor market as "quite healthy" and overall balanced, reducing the urgency of further production cuts. She warned that inflation may not return to 2% until the end of 2027 or even early 2028.
To balance the Fed's dual mission, Hamak believes that the central bank must maintain a "restrictive policy stance so that we can bring inflation back to our goals."
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